This is according to the latest Global Economic Conditions Survey (GECS) compiled by the Association of Chartered Certified Accountants (ACCA) and the Institute of Management Accountants (IMA).
The findings revealed that during the second quarter of 2014, 45 per cent of respondents in Africa such as large financials and the public sector reported a loss of confidence, up from 36 per cent in early 2014, while only 28 per cent reported confidence gains, down from 33 per cent.
“It appears as though a crisis mentality has taken hold among respondents in Africa. Further analysis reveals that business confidence has steadily become decoupled from business opportunities since the second quarter of 2013 (Q2 2013), and increasingly tied to government spending,” said Manos Schizas, senior economic analyst at ACCA.
(READ MORE: S.Africa's Business Confidence Index drops to 88.9 in May)
“In the latest quarter business confidence has become more sensitive to fears of unsustainable government finances as well as the strength of cash flow and demand. These are all signs of businesses worried about survival, and of a looming crisis.”
Karen Smal, acting head of ACCA South Africa, added that the macroeconomic environment was not a factor affecting business confidence on the continent as the majority of respondents, 55 per cent, remained optimistic that conditions were improving.
According to the GECS, global economic recovery has begun to run out of momentum as declining business opportunities and improving investment environment cancel each other out.
(WATCH VIDEO: Business confidence edges lower)
The findings show that North America and South Asia are showing capital spending growth while Africa and the Middle East fared worst.
While emerging markets continue to underperform in areas such as access to growth capital, the gap between them and developed markets is now narrowing.
The survey also found that confidence among large financial institutions in the United States and Europe are declining sharply in anticipation of tougher stress tests, rising interest rates and falling property prices as well as geopolitical risks.
(WATCH VIDEO: Sage: Global business confidence up)